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Managing Change

Managing Change. Change in business is concerned with altering the way people do their work. It involves changing structures and introducing new technology to produce different outcomes. Business must respond to change if they are to maintain a competitive advantage.

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Managing Change

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  1. Managing Change Change in business is concerned with altering the way people do their work. It involves changing structures and introducing new technology to produce different outcomes. Business must respond to change if they are to maintain a competitive advantage. Changes include: production, marketing, the business plan, objectives and goals. Changes are external (outside the business) or internal (inside the business)

  2. External Influences • The changing nature of markets • constantly changing, reflecting changing needs, wants, fashions, technology, population and concepts of quality. Also other countries trade policies, patterns of demand, competition, exchange rates and weather.

  3. Economic Influences • economic cycles, employment, inflation, consumption, investment. • the labour force, wages and prices • govt policies, such as microeconomic reform • international economic environment, infrustructure, transport and power

  4. Financial Influences: • Deregulation of financial system: removal of Govt restrictions • Increasing range of financial products and increased competition of financial institutions.

  5. Geographic influences: • Population (movements, increases, decreases) • Availability of natural resources, climate, water • Aust’s geographic isolation, Aust businesses expanding O/S • proximity to suppliers, competitors, customers • changes in landscape (new roads) • Industry clusters (businesses with linking relationships setting up in close proximity) – outsourcing of duties in production process to 3rd parties. • Act of God – Natural disasters

  6. Social Influences • Ageing population (nursing homes, health services) • Changing role of women in workplace • growth of leisure and health activities (day spas, gyms) • > diversity in population, new opportunities for retailers. • Trend towards retirement • Unpopular business decisions, environment record • Revelations of exploitation or corruption • Stereotyping, racism, sexism • General changes in social attitudes

  7. Legal Influences • Govt legislation, Fed and state, regulatory bodies, govt bodies, GST, BAS, ACCC • Competition regulation, health and safety, consumer protection, licensing, taxation, credit • Legal made by courts – precedents for other cases eg public liability costs • Political Influences • Each party has its own objectives for businesses, they create legislation and policies that have impact. • Managers need to plan for outcomes of change in government

  8. Technological Developments • technology changes influencing: • production methods • information exchanging • agriculture and mining • Lowering costs of production • reducing lead time • reducing barriers of distance, suppliers and customers • Creating competitive advantages

  9. Internal Influences • Effects of accelerating Technology: • E-commerce: Buying and selling of products, funds transfer, electronic support for products / services. • New systems and procedures: • Reorganising employees into work teams to gain productivity and creativity benefits • Using Total Quality Management principles to emphasise quality and continuous improvement • Worlds best practice, benchmarking • Computer systems and techniques, CAD, CAM, stock, POS • Changes to practices such as petty cash, rostering

  10. New Business Cultures: • Refers to shared attitudes, values, beliefs of people. The way people in a business behave. • Modern communication methods ie email • downsizing – reduce bureaucracy • change in leadership, methods, vision • rewards system

  11. Structural responses to change • Outsourcing: Non core services ie marketing, accounting, parts • Save labour cost, rent, • fulfil temporary demand for staff ie new IT network or hardware system. • Better quality, value for money, specialisation • Flat organisation structures: minimise bureaucracy, cut out middle management increase flexibility, accountability, increasing workload. • Strategic alliances and networks: Businesses and suppliers, Businesses and other businesses wanting to access a market so both can gain strategic advantage ie Qantas, BA, Cathay Pacific, American Airlines in One World alliance.

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